Price transparency in healthcare is about making consumers feel more prepared, involved and informed. Although some payers and providers have already been providing pricing estimates for select items and services before care is delivered, healthcare services are not like other goods. Healthcare is more expensive, confusing and personal, and it involves decisions that can have life-long consequences. In addition, more than half of US consumers – 50% of whom are college-educated – don’t understand the healthcare system well enough to effectively navigate their healthcare benefit choices and services utilization. The inability of consumers to effectively research and compare healthcare costs and quality is a barrier to achieving high health literacy and ultimately lowering costs.
To help consumers improve their understanding of costs, The Centers for Medicare and Medicaid Services (CMS) has issued two final rules – one addresses hospital price transparency, and the other transparency in coverage. By pairing “high-tech” solutions with a “high-touch” approach to consumer engagement, healthcare providers and payers can make a lot of progress toward complying with the new rules.
In the United States, health policy changes have been enacted to make cost information in the healthcare industry more easily available to consumers and other stakeholders. Leaders are hoping the new policies will help lower costs and provide better metrics for healthcare spending.
Under the Hospital Price Transparency Final Rule, each US hospital is required to:
The Hospital Price Transparency Rule went into effect on 1 January 2021. Failure to comply will come with penalties of USD 300 per day. However, there are solutions available that can help hospitals avoid fines and quickly comply with the new rule.
Find out how your organization can comply:
The Transparency in Coverage Final Rule, issued in October 2020, requires health plans and self-insured employers to disclose detailed price information and cost-sharing information to consumers and other stakeholders. The final rule takes the following approaches to making pricing information more accessible, which must be executed by three key deadlines:
Penalties for health plans failing to comply with the new rule have yet to be announced.
Get the full details on the rule:
The US Department of Health and Human Services (HHS) has announced another new rule related to the No Surprises Act that's designed to protect consumers from surprise medical billing. The provisions of the new rule include:
The new rule is currently set to take effect for healthcare providers, facilities and payers on 1 January 2022.
Find out more about the new rule:
The role of technology in helping realize the full promise of price transparency in healthcare cannot be understated. For example, interoperability and secure flow of information between healthcare providers and payers will be critical so when a patient “shops” for services, the healthcare provider they select has access to the medical and insurance records necessary to deliver care.
Consumer-friendly tools that make data actionable will also be important. Technology can play an important role in helping consumers understand their out-of-pocket costs and schedule the right bundle of services as advised by their physicians, so they get the care they want at the location of their choosing. In addition, tools such as price schedules and healthcare cost estimators can ensure healthcare providers and patients have access to the same pricing information as they partner in navigating the healthcare system.
Healthcare consumers need timely, accurate and trusted information about the cost of care to make important healthcare decisions, and providers are well-positioned to fill this need. Insurers and self-insured employers can play a critical role by making comparative cost and quality information available to their members — even without a large market share or spending the time and resources to build a price transparency solution on their own.
Health insurance plans — as well as providers — should be aware of how consumers might respond to potential cost savings on standard charges and negotiated prices. That’s why insights into consumer behavior are critical to informing any successful strategy related to price transparency. Understanding consumer knowledge, attitudes and behaviors can help organizations design more effective pricing strategies and potentially become innovators in their markets.
In addition to understanding general consumer behavior, knowing dynamics specific to your local healthcare market can help produce a winning strategy under price transparency. Competitive intelligence on pricing and accessibility of services, as well as insights into internal costs, can help healthcare organizations understand which shoppable services are the best to offer in their geographic region.
Meet CMS requirements and support patients by implementing a consumer-friendly price transparency application.
Help provide consumers with accurate, real-time estimates of their out-of-pocket healthcare costs.
Guide your price transparency strategy and help ensure compliance with expert insights into consumer behavior and market dynamics.
Compare costs in the US and other countries for common healthcare procedures.
See the results of an IBM Watson Health PULSE® poll that asked healthcare consumers about their thoughts on prices.
Four experts were asked what untintended consequences could arise from price transparency — see what they had to say.